Medical Office Building
For Sale
$1,500,000
3840 Watt Ave, Sacramento, CA 95864
Net leased medical office building in Sacramento, CA for sale.
Property Size5,400 SF
Price / SF$277.78
Days on Market175
Property Features for 3840 Watt Ave
General Information
Standard status
Active
Size
5,400 SF
Listing Agency:
RE/MAX Gold
2019247
Listed By:
Ranganayaki Ranga Pathak · License #01364897
2019247
Source:
Exprealty
Added: Mar 1
Changed: Aug 23
Last Checked: Aug 22 at 4:16PM
Displayed information is deemed reliable but is not guaranteed and should be independently verified. All listing content including descriptions, pricing, images are the copyrighted material of RE/MAX Gold
Investment Insights
Based on property information with market context.
Located within the Lincoln Center East Business Park in Sacramento, CA, 3840 Watt Avenue, Building B is a 5,400 square foot medical office building. Constructed around 2005 and remodeled in 2016, the building is currently a net leased investment opportunity. The property is fully occupied by a credit-rated tenant. The layout includes a reception area, nine medical examination rooms, private offices, a front office area, physical therapy areas, a blood draw room with restroom, an employee break room, and multi-stall restrooms. The tenant pays the base rent, property taxes, and property insurance. The tenant is responsible for the inside of the property, while the landlord is responsible for the structure, OA dues, and HVAC replacement. The property features abundant parking and well-landscaped and maintained grounds. The tenant, Agile Occupational Medicine, would face significant operational challenges to relocate due to specialized build-outs, equipment relocation, and regulatory requirements. The property offers consistent income and security from a credit-worthy, recession-resistant tenant.
Key Highlights
- Net leased investment opportunity with a credit‑rated tenant occupying 100% of the building, providing consistent income and security.
- Tenant is responsible for base rent, property taxes, and property insurance, minimizing landlord responsibilities.
- Tenant would face significant operational challenges to relocate due to the specialized nature of the medical practice, ensuring long‑term tenancy.
Financial Insights
Estimated NOI and Cap Rate
NOI = area × lease_rate × (100 − vacancy) / 100 × (1 − expense_ratio). Net Operating Income — what the owner takes home each year before mortgage payments and income tax. Effective rent (asking rent minus vacancy losses) minus operating costs (taxes, insurance, maintenance, management).
NOI / Yr
$83,164
Cap rate = NOI / list price × 100. Capitalization rate — annual return on a fully cash purchase, before financing. NOI divided by price. Higher means more income per dollar invested, but usually also more risk or older condition. 5–8% is typical for stabilized commercial property; double digits often signal distressed deals.
Cap Rate
5.54%
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$1,663,280
$1.7M
Cap Rate 7%
$1,188,057
$1.2M
Cap Rate 9%
$924,044
$924.0K
Market Conditions
NOI Build-Up for 5,400 SF
Vacancy — income lost from leasable area expected to sit empty during the year, subtracted from gross rent.
EGI (Effective Gross Income) — gross rent minus vacancy losses, the realistic income before paying operating costs.
OpEx (Operating Expenses) — recurring costs to operate the property (property tax, insurance, utilities, maintenance, management); excludes financing and capital improvements.
NOI (Net Operating Income) — income a property generates after operating costs but before financing and taxes.
Gross rent
$149.0K $27.60/SF
− Vacancy
−$10.4K −$1.93/SF
EGI
$138.6K $25.67/SF
− OpEx
−$55.4K −$10.27/SF
NOI
$83.2K $15.40/SF
Area
Sacramento, CA
Vacancy
7.00%
Lease Rate
$27.60 /SF/Yr
Expense Ratio
40.00%
Simulate Cap Rate and NOI
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$1,663,280
Cap Rate 7%
$1,188,057
Cap Rate 9%
$924,044
Alternative Uses
Best Use
Healthcare Medical
$1.19M
$1.04M – $1.39M
NOI $83,164 @ 7.0% cap · market cap 5.54%
Second Best
Office B
$1.05M
$919.6K – $1.23M
NOI $73,571 @ 7.0% cap · market cap 4.90%
Theoretical Best
Specialty Retail
$1.45M
$1.27M – $1.69M
NOI $101,574 @ 7.0% cap · market cap 6.77%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
763
Businesses Nearby
Under-served
Demand for This Use
Explore this area
Business Placement
Demographics for 95864, CA
24,249
Population
10,286
Households
2.4
Avg Household Size
44
Median Age
58%
College-Educated
95%
High-School Grad
6.3 sq mi
ZIP Area
3,849
Density / Sq Mi
$129,083
Median Household Income
$63,220
Median Earnings
$1,863
Median Rent
$770,200
Median Home Value
Market
Vacancy Rate% for Office in Sacramento, CA
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Medical Office Space - Net leased medical office building in Sacramento, CA for sale.
Where is this medical office space located?
The property is located at 3840 Watt Ave Sacramento, CA.
What is the asking price?
The asking price for this property is $1,500,000.
What are key features of this property?
This property features: Net leased investment opportunity with a credit‑rated tenant occupying 100% of the building, providing consistent income and security.; Tenant is responsible for base rent, property taxes, and property insurance, minimizing landlord responsibilities.; Tenant would face significant operational challenges to relocate due to the specialized nature of the medical practice, ensuring long‑term tenancy.
